Although the Henderson City Council agreed to set the tax rate for fiscal 2010 at the last budget session on June 9, 2009 at 57.5 cents per hundred dollars of valuation, it voted five to three last night to raise the rate to 58.5 cents.
The increase represents an additional two cents on the tax rate from fiscal 2009.
After considering funding a code compliance position, restoring $15,000 to the abandoned housing demolition budget, filling a vacant fire fighter position, and/or restoring a controversial contract with Community Workforce Solutions, the council in the end agreed to devote the entire $84,300 raised by the additional levy to the unrestricted fund balance.
Before what was to be a routine vote on a mutually agreed-upon budget, member Mike Rainey expressed concern about the city’s budget needs for fiscal 2011. Noting that two major expenses would be reintroduced (payment to Vance County on the new City Hall at $15,000 and payment for the city’s interest in the new Economic Development Commission at $60,000), Rainey said that a two cent tax increase would make the next budget easier.
Member Lonnie Davis endorsed the idea, likening the one cent increase to “tubing down a hill — one slip and you’re gone”. Davis went on to say that the council should have started at a five [cent] increase and “worked down”.
Council member Mary Emma Evans noted that she wanted to fund the Code Compliance Department and Community Workforce solutions, and said that the best she could do is vote her conscience.
Member Bernard Alston endorsed the idea of putting the additional funds in the unrestricted general fund.
Council member Mike Inscoe called the issue “almost like a double-edged sword”. Stating that he has been an advocate for the small business person struggling to keep a business open in the city, he indicated to Henderson Fire Chief Danny Wilkerson that he wished every position could be funded. He did note that $149,000 had been spent on a new fire truck, showing that the council made an attempt to buy equipment and fund a position.
Ward 3 member Brenda Peace spoke in favor of the two cent increase.
After Davis moved to increase the tax rate by two cents, a discussion ensued as to where the money should be allocated. When Henderson Mayor Pete O’Geary expressed a desire to make the allocation at a subsequent work session, City Manager Ray Griffin insisted that the council provide direction in the motion.
Both Alston and Inscoe noted that the council could choose to spend the money out of the general fund in the future.
In the end, Evans, Inscoe, and Daeke voted against the increase. According to City Attorney John Zollicoffer, a budget ordinance vote does not require a three-quarters majority to pass on first reading.